Walmart
Walmart is a discount department store chain founded by Sam Walton in 1962. It is the largest retailer in the world, with most of its stores being supercenters that are both discount stores and full-line supermarkets. Walmart is headquartered in Bentonville, Arkansas. Walmart is the world's largest company by revenue, with US$514.405 billion, according to the Fortune Global 500 list in 2019. It is also the largest private employer in the world with 2.2 million employees. It is a publicly traded family-owned business, as the company is controlled by the Walton family. Sam Walton's heirs own over 50 percent of Walmart through their holding company Walton Enterprises and through their individual holdings. Walmart was the largest U.S. grocery retailer in 2019, and 65 percent of Walmart's US$510.329 billion sales came from U.S. operations. Walmart was listed on the New York Stock Exchange in 1972. By 1988, it was the most profitable retailer in the U.S., and it had become the largest in terms of revenue by October 1989. The company originally was geographically limited to the South and lower Midwest, but it had stores from coast to coast by the early 1990s. Sam's Club opened in New Jersey in November 1989 and the first California outlet opened in Lancaster, California in July 1990. A Walmart in York, Pennsylvania opened in October 1990, the first main store in the Northeast. Walmart's investments outside the U.S. have seen mixed results. Its operations and subsidiaries in Canada, the United Kingdom, Central America, South America and China are highly successful, whereas its ventures failed in Germany and South Korea. History Walmart was originally Walton's Five-and-Dime''.'' '''Walton had previously worked at JCPenney. After that, he started the five-and-dime-store. However, he opened the first Walmart in 1962, just like Target and Kmart. The name Wal-Mart was coined by Walton's assistant Robert Bogle. Walmart rapidly grew, due to the low-price merchandise. In 1977, Walmart purchased '''Mohr-Value '''and '''Hutcheson Shoe Company. In 1981, they acquired 92 Kuhn's Big K stores. In 1983, the first Sam's Club opened. In 1987, Walmart and Tom Thumb opened Hypermart USA. However, in 1988, the first Walmart Supercenter opened in Missouri. Soon the Hypermart USA stores closed. That made Walmart surpass Toys "R" Us as the largest toy seller. In 1991, the first international Walmart opened in Mexico City. After 30 years, in 1992, Walmart surpassed Sears as the largest retailer. In the 90s, Walmart had opened stores in Mexico, Germany, Canada, South America, and South Korea. In 1994, Walmart purchased 91 PACE Membership Warehouse clubs from Kmart and 122 Woolco stores from Woolworth in Canada. The Canada Woolco stores became Walmart Canada stores. In 1998, Walmart opened the first Walmart Neighborhood Market. In 2006, Walmart opened a new type of supercenter that was upscale, so they can attract affluent customers. In 2010, Walmart purchased Vudu. Walmart competes with Target and Kmart, along with other regional retailers. Store Concepts Canada *'Walmart Canada' - discount chain *'Walmart Supercentre' - hypermarket chain Mexico *'Walmart de México y Centroamérica' - discount chain United Kingdom *'ASDA' - supermarket chain United States * Walmart - discount chain. Introduced in 1962. Only features one entrance. Carries general merchandise and limited groceries. Some newer and remodeled discount stores have an expanded grocery department, similar to Target's PFresh department. Many of these stores also feature a garden center, pharmacy, Tire & Lube Express, optical center, one-hour photo processing lab, portrait studio, a bank branch, a cell phone store, and a fast food outlet. Some also have gasoline stations. Discount Stores were Walmart's original concept, though they have since been surpassed by Supercenters. As of January 31, 2019, there were 386 Walmart Discount Stores in 41 states and Puerto Rico. Idaho, Montana, Nebraska, North Dakota, South Carolina, South Dakota, Utah, District of Columbia, West Virginia, and Wyoming are the only states and territories where an original store does not operate. *'Walmart Supercenter' - hypermarket chain. Introduced in 1988. Includes a larger grocery section including meat and poultry, baked goods, delicatessen, frozen foods, dairy products, garden produce, and fresh seafood. Many Walmart Supercenters also have a garden center, pet shop, pharmacy, Tire & Lube Express, optical center, one hour photo processing lab, portrait studio, and numerous alcove shops, such as cellular phone stores, hair and nail salons, video rental stores, local bank branches and fast food outlets. Features more products, two entrance and services by checkout aisle. Walmart Supercenter signs were used until the newer logo appeared on the stores. Many Walmart Supercenters have featured McDonald's restaurants, but in 2007, Walmart announced it would stop opening McDonald's restaurants at most of their newer stores, most likely due to nutritional concerns. Most locations that opened up after the announcement had Subway as their restaurants, and some McDonald's inside the stores were replaced with Subways. In some Canadian locations, Tim Hortons were opened. Recently, in several Supercenters, like the Tallahassee, Florida location, Walmart added Burger King to their locations, and the location in Glen Burnie, Maryland, due to its past as a hypermarket called Leedmark, which operated from May 1991 to January 1994, boasts an Auntie Anne's and an Italian restaurant. *'Sam's Club'- warehouse club *'Walmart Market' - grocery chain Competition In North America, Walmart's primary competitors include grocery stores and department stores like Aldi, Kmart, Kroger, Ingles, Publix, Target, Harris Teeter, Shopko, and Meijer, and Winn Dixie, Canada's The Real Canadian Superstore, Sobeys and Giant Tiger, and Mexico's Comercial Mexicana and Soriana. Competitors of Walmart's Sam's Club division are Costco and the smaller BJ's Wholesale Club chain. Walmart's move into the grocery business in the late 1990s set it against major supermarket chains in both the United States and Canada. Several smaller retailers, primarily dollar stores, such as Family Dollar and Dollar General, have been able to find a small niche market and compete successfully against Walmart. In 2004, Walmart responded by testing its own dollar store concept, a subsection of some stores called "Pennies-n-Cents." Walmart also had to face fierce competition in some foreign markets. For example, in Germany it had captured just 2 percent of the German food market following its entry into the market in 1997 and remained "a secondary player" behind Aldi with 19 percent. Walmart continues to do well in the UK, where its Asda subsidiary is the second-largest retailer. In May 2006, after entering the South Korean market in 1998, Walmart sold all 16 of its South Korean outlets to Shinsegae, a local retailer, for US$882 million. Shinsegae re-branded the Walmarts as E-mart stores. Walmart struggled to export its brand elsewhere as it rigidly tried to reproduce its model overseas. In China, Walmart hopes to succeed by adapting and doing things preferable to Chinese citizens. For example, it found that Chinese consumers preferred to select their own live fish and seafood; stores began displaying the meat uncovered and installed fish tanks, leading to higher sales. Charity Sam Walton believed that the company's contribution to society was the fact that it operated efficiently, thereby lowering the cost of living for customers, and, therefore, in that sense was a "powerful force for good", despite his refusal to contribute cash to philanthropic causes. Having begun to feel that his wealth attracted people who wanted nothing more than a "handout", he explained that while he believed his family had been fortunate and wished to use his wealth to aid worthy causes like education, they could not be expected to "solve every personal problem that comes to their attention". He explained later in his autobiography, "We feel very strongly that Wal-Mart really is not, and should not be, in the charity business," stating "any debit has to be passed along to somebody—either shareholders or our customers." Since Sam Walton's death in 1992, however, Walmart and the Walmart Foundation dramatically increased charitable giving. For example, in 2005, Walmart donated US$20 million in cash and merchandise for Hurricane Katrina relief. Today, Walmart's charitable donations approach US$1 billion each year. Economic impact Kenneth Stone, Professor of Economics at Iowa State University, in a paper published in Farm Foundation in 1997, found that some small towns can lose almost half of their retail trade within ten years of a Walmart store opening. He compared the changes to previous competitors small town shops have faced in the past—from the development of the railroads and the Sears Roebuck catalog to shopping malls. He concludes that small towns are more affected by "discount mass merchandiser stores" than larger towns and that shop owners who adapt to the ever-changing retail market can "co-exist and even thrive in this type of environment." One study found Walmart's entry into a new market has a profound impact on its competition. When a Walmart opens in a new market, median sales drop 40 percent at similar high-volume stores, 17 percent at supermarkets and 6 percent at drugstores, according to a June 2009 study by researchers at several universities and led by the Tuck School of Business at Dartmouth College. A Loyola University Chicago study suggested that the impact a Walmart store has on a local business is correlated to its distance from that store. The leader of that study admits that this factor is stronger in smaller towns and doesn't apply to more urban areas saying "It'd be so tough to nail down what's up with Wal-Mart". These findings are underscored by another study conducted in 2009 by the National Bureau of Economics that showed "large, negative effects" for competing businesses within 5 to 10 miles (8 to 16 km) of the newly opening big-box retailer. This same study also found that the local retailers experience virtually no benefit. Walmart's negative effects on local retailers may be partially explained by studies that find that local firms re-invest nearly 63 percent more of profits in other local businesses compared to chain retailers, as found by the Maine Center of Economic Policy in 2011. David Merriman, Joseph Persky, Julie Davis and Ron Baiman did a study in Economic Development Quarterly outlining the impacts of Walmart in Chicago. The study draws from three annual surveys of enterprises within a four-mile radius of a new Chicago Walmart and it "shows that the probability of going out of business was significantly higher for establishments close to that store". The study illustrated how approximately 300 jobs were lost due to the opening of the store, which is about equivalent to Walmart's employment in the area. The overall findings of this study reinforce the "contention that large-city Walmarts, like those in small towns, absorb retail sales from nearby stores without significantly expanding the market" as this is one of the first studies of Walmarts economic impacts on local economies. * A 2001 McKinsey Global Institute study of U.S. labor productivity growth between 1995 and 2000 concluded that "Wal-Mart directly and indirectly caused the bulk of the productivity acceleration" in the retail sector. Robert Solow, a Nobel laureate in economics and an adviser to the study, stated that "by far the most important factor in that growth is Wal-Mart." * The Economic Policy Institute estimates that between 2001 and 2006, Wal-Mart's trade deficit with China alone eliminated nearly 200,000 U.S. jobs. Another study at the University of Missouri found that a new store increases net retail employment in the county by 100 jobs in the short term, half of which disappear over five years as other retail establishments close. * A 2004 paper by two professors at Pennsylvania State University found that U.S. counties with Walmart stores suffered increased poverty compared with counties without Wal-Marts. They hypothesized that this could be due to the displacement of workers from higher-paid jobs in the retailers customers no longer choose to patronize, Wal-Mart providing less local charity than the replaced businesses, or a shrinking pool of local leadership and reduced social capital due to a reduced number of local independent businesses. Dr Raj Patel, author of "Stuffed and Starved: Markets, Power and the Hidden Battle for the World Food System", said in a lecture at the University of Melbourne on September 18, 2007, that a study in Nebraska looked at two different Wal-Marts, the first of which had just arrived and "was in the process of driving everyone else out of business but, to do that, they cut their prices to the bone, very, very low prices". In the other Wal-Mart, "they had successfully destroyed the local economy, there was a sort of economic crater with Wal-Mart in the middle; and, in that community, the prices were 17 percent higher". * A 2005 story in The Washington Post reported that "Wal-Mart's discounting on food alone boosts the welfare of American shoppers by at least US$50 billion per year." A study in 2005 at the Massachusetts Institute of Technology (MIT) measured the effect on consumer welfare and found that the poorest segment of the population benefits the most from the existence of discount retailers. * A June 2006 article published by the libertarian Ludwig von Mises Institute suggested that Wal-Mart has a positive impact on small business. It argued that while Wal-Mart's low prices caused some existing businesses to close, the chain also created new opportunities for other small business, and so "the process of creative destruction unleashed by Wal-Mart has no statistically significant impact on the overall size of the small business sector in the United States." * In 2006, American newspaper columnist George Will named Wal-Mart "the most prodigious job-creator in the history of the private sector in this galaxy" and that "by lowering consumer prices, Wal-Mart costs about 50 retail jobs among competitors for every 100 jobs Wal-Mart creates". In terms of economic effects, Will states that "Wal-Mart and its effects save shoppers more than US$200 billion a year, dwarfing such government programs as food stamps (US$28.6 billion) and the earned income tax credit US$34.6 billion)". * A 2014 story in The Guardian reported that the Wal-Mart Foundation was boosting its efforts to work with U.S. manufacturers. In February 2014, the Walmart Foundation pledged US$10 billion to support domestic manufacturers and announced plans to buy US$250 billion worth of American-made products in the next decade. See also * List of Walmart Locations * Decor Guide * Target - competitor * Kmart - competitor External links Official website Category:Discount stores Category:Superstores Category:Big-Box Stores Category:Department stores Category:Retailers by type Category:Retailers Category:Hypermarkets Category:Mall Retailers